OGH: Due diligence in the valuation of a property

Oct 13, 2021 Benn-Ibler Rechtsanwälte

The Supreme Court (Oberster Gerichtshof, OGH) examines whether deviations in the appraisal of the value of real estate are still in accordance with due diligence.

The plaintiff commissioned the defendant, a real estate brokerage company, with the sale of two properties within the scope of an exclusive broker agreement. He assumed a sales price of around EUR 1 million, but the broker in charge stated that the actual value was only EUR 780,000. Consequently, a purchase contract was concluded at the lower value. The plaintiff then had the properties appraised by two other real estate agents, who arrived at a value similar to the plaintiff's appraisal.

The plaintiff now demanded the difference between the actual value and the purchase price, as well as the commission, from the defendant. The court of first instance granted the claim. The Court of Appeal rejected the claim in part and referred to German case law according to which fluctuation margins were unavoidable and thus justifiable.

The OGH held that the broker has a special duty of loyalty in the context of an exclusive broker agreement. It is true that the market value could not be determined exactly, and the deviating estimate by a court expert alone did not necessarily constitute a breach of due diligence by the defendant. For this to be the case, however, the broker had to have made comprehensible considerations about the property value, as well as point out the resulting range of estimates.

At present, however, it was not legally relevant for the OGH that a careful determination of the value might have resulted in a deviation from the established value, because the plaintiff's main concern was to maximise the sales price; moreover, he had already informed the defendant of his estimate of the purchase price. The statements of the Court of Appeal were also not to be followed, because not every valuation that lies within a possible range of fluctuation is automatically also due diligence.

The OGH set aside the partial judgment and ordered the court of first instance to make a new decision after supplementing the proceedings.

6Ob115/21m (06.08.2021)